Reports alone won’t cut red tape: small business groups

The Franchise Council of Australia’s Stephen Giles says the Productivity Commission’s nine-month benchmarking study into regulator engagement with small business “looks to be a constructive initiative, however they need some structure behind them to give power and real relevance to their conclusions”.
Photo: Paul Jones

Small business industry groups are jaded about the ability of a productivity commission study to reduce red tape in the sector, citing government’s poor track record of acting on review recommendations, and stressing that it must be supported by structural rules to stop states and local councils recreating red tape.

COAG have asked the Productivity Commission to undertake a nine-month benchmarking study into regulator engagement with small business in the hope it will throw up new ideas for reducing compliance.

Submissions are due by March 15.

“This looks to be a constructive initiative, however they need some structure behind them to give power and real relevance to their conclusions," Franchise Council of Australia deputy chairman Stephen Giles said.

The research study aims to identify leading practices in regulator engagement and determine whether these can be adopted while sustaining good regulatory outcomes.

Mr Giles said that previous efforts to standardise legislation, such as harmonising Fair Trading legislation, were quickly unravelled by state legislators.

“The ink was not even dry when South Australia introduced its own state franchising legislation over the top of a national framework," he said.

The productivity commission will also examine whether the current definition of a “small business" should be altered, acknowledging that inconsistent definitions across different regulators and jurisdictions is creating problems.

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Family Business Australia chief executive Philippa Taylor said applying a consistent vocabulary is long overdue, but is disappointed the review makes no mention of expanding the definition.

Family Business Australia has argued for years that the current definition – less than five staff and under $2 million annual turnover – is too narrow.

The announcement comes just days before the anticipated release of a Senate report on the contribution of family businesses to the Australian economy, along with the structural, organisational and cultural challenges facing them.

The final report about family business in Australia was due in February but was postponed until mid-March.